1) Select one country in each of the three stages of economic development. For each country, outline the basic existing marketing institutions and show how their stages of development differ. Explain why.
The economic phase represents the stages in which a nation’s economy grows and thrives. The three stages of economic development are MDCs (More developed countries), LDCs (less developed countries), and LLDCs ( Least developed countries). Economic development is generally understood to mean an increase in national production reflected by an increase in the average per capita gross domestic product (GDP) or gross national income (GNI).
The most obvious MDCs is the United States. The US is considered an industrialized country with high per capita income. The US is an overall sovereign state that has a developed economy and advanced technological infrastructure relative to other less industrialized nations.The United States has very high income per capita as well as high GDP per capita.Furthermore, the US has high level of human development. The US has a high income economy. Consumption per person is a good indicator of development. The US has very high consumption per person indicating the citizens consume more. The US also has very high economic measures, national income, life expectancy and education/literacy rates. The US also is very technologically advanced compared to many contries. The US is also very politcally stable.
An example of LDCs is Mexico. LDCs are industrially developing countries just entering world trade with relatively low per capita incomes. LDCs face important barriers to structural transformation, both domestically and globally. As a group, LDCs continue to face high incidence of poverty with more than 35 per cent of their population still living in extreme poverty. Mexico falls into this category with much poverty still prominet in the country. Mexico for example has limited develop due to poor infrastructure and technology. Mexico aslo has number of capacity constraints as well as high annual population growth rates which present challenges for enrolment in higher education and training a skilled workforce. Mexico is poorer and less industrially-developed than many of the MDCs. Therefore, Mexico is much more developed than LLDCs with better infrastructure and technology but less developed than the MDCs with overall less GDP per capita and other economic measures.
LLDCs are the least developed countries and an example would be Cambodia. LLDCs are idustrially underdeveloped, agrarian, subsistence societies with rural populations, extremely low per capita income levels, and little world trade involvement. Violence and the potential for violence are often associated with LLDCs. Of note, lowest levels of development often do not collect or report data suitable for international resources. LLDCs continue to be marginalized from global trade as demonstrated by their share of global merchandise exports, which remains below one percent. Cambodia specifically has a very poor global market precence. Cambodia faces high trade costs which makes internation trade and growth difficut. Cambodia also struggles due to poor infrastructure and poor transport infrastructure. The country also has overall lack of technology advances or communication. Cambodia also has extreme economic vulnerability.Cambodia has very low per-capita income, poor human assets, and extreme economic vulnerability which makes further development or international growth. Finally Cambodia has low rates of literacy, high unemployment, rapid population growth, and their exports are largely agricultural or raw materials. Capital equipment is scarce, production technologies are primitive, and productivity is overall low.
· More-developed countries (MDCs)
Japan’s manufacturing industry is the pillar of the national economy, and its scientific research, aerospace, manufacturing and education levels rank among the top in the world. At the same time, international marketing plays an important role in the national economy. From the 1950s, Japan established the development policy of trade. According to the basic principle of most-favored-nation treatment in GATT, free trade with most countries and regions has created favorable international market conditions for the continuous expansion of Japan’s foreign trade scale. Since then, Japan’s foreign trade has grown rapidly, and the main imports are: crude oil, natural gas, food, raw materials, etc.; The main export commodities are: automobiles, electrical appliances, general machinery, chemical products and so on. The main trade objects are China, the United States, Germany and so on.
· Less-developed countries (LDCs)
South Korea is an international marketing power whose industries are mainly manufacturing. Exports of semiconductors, auto parts, ships, personal computers and other products. At the same time to foreign imports of crude oil, steel, natural gas and other products. South Korea advocates free trade, avoids trade barriers and reduces trade transaction costs. It has economic and trade relations with more than 180 countries and regions in the world. South Korea has also reached free trade agreements with the European Union and the United States.
· Least-developed countries (LLDCs)
Ethiopia is one of the least developed countries in the world. It is still an agricultural country of nearly 100 million people, and most of them are farmers. Because of the Savanna climate and subtropical forest climate, Ethiopia is very suitable for the growth of flowers, coffee, sesame and the development of animal husbandry, they export some of the primary products. At the same time, Ethiopia’s industry is in the early stages of development and infrastructure is just beginning, so it does not have the capacity to produce products with higher technology. They rely on imported machinery, automobiles, oil, fertilizer and other products. The import and export deficit is large, and import products are really expensive. In addition, Ethiopia is a landlocked country and its import and export transportation costs are high.
According to the three countries above, MDCs, LDCs and LLDCs are very different in development. First, their main industries are very different. The better the economy, the stronger the manufacturing capacity. The poorer the economy, the more likely it is to be agricultural. In addition, in terms of international trade, countries with better economic development are more inclined to free trade. They have signed free trade treaties with many countries, and also adopted measures such as lowering tariffs to promote international trade. LLDCs, on the other hand, relies heavily on imports of high-end products and only exports low-end products, resulting in a large trade deficit.
I think there are many reasons for this. First, geography. We can see that most of the LLDCs are located inland. As I mentioned in Ethiopia, they don’t have good ports, so the transportation cost of doing international trade is huge. Second, population. Too many people make it difficult to allocate resources. Especially for the countries that are already located in the inland areas, the scarce resources can only barely meet the minimum living standards of the people, and there is no fund for industrial development. Third, war. Part of LLDCS is still in a state of social instability. War can lead to a slump in the economy, which can lead to a series of problems. Fourth, culture. Religious conflicts and ethnic divisions are also important reasons. As I mentioned in Ethiopia, ethnic conflict has always been a big problem.